Monday, January 15, 2007

Internet Fraud ... Possible Opportunity for Banks

The Australian financial services industry has proposed that some consumers be liable for internet banking fraud. On 12 January 2007, the Australian Securities & Investments Commission released the proposals that would make users potentially liable for the full amount of losses unless they have minimum equipment security. The internet industry said that consumer confidence in internet banking would be undermined. Some Australian banks have introduced more security measures to protect against internet transaction fraud.

This will be a sad day for internet banking as the majority of people may not realize that they need to purchase additional equipment to access their own funds. Surely the banks should be liable for the amount if they can not offer the software for free. A lot of computer illterate people who have only just begun to use internet banking will reject it becasue of the risks. If this is the way that ASIC heads I feel there will be a major decline in the use of internet banking in the future. Since the banks are closing branches left, right and center it is going to show a major problem with customer service at most banks.

Looking at this from an investor view point instead of a consumer I can see great gains for the banks. Firstly they can market their own firewall security and onsell it to the customer. Secondly people who don't take it up are liable for the full amount of any loss. This could save the banks millions each year which will add value to shareholders. I really need to reevaluate the banking sector and will try and find some good deals.

Good Luck Investing.

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